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Thursday, August 6, 2015

Lufthansa: Positive developments on Serbian market

Lufthansa satisfied with Serbia results despite strong competition

Lufthansa, Europe’s largest airline, says it expects further positive developments on the Serbian market but warns that distortion of competition will negatively impact passengers. Martin Riecken, Lufthansa’s Director of Corporate Communications in Europe, says the German carrier has seen an increase in the number of travellers on its flights from Frankfurt and Munich to Belgrade so far this year, despite strong competition. “In the very competitive Serbian market, Lufthansa was able to increase the number of transported passengers between Germany and Serbia by almost 10% in the first four months of the current year, despite reduced capacities. A trend which we expect to continue in the next years”, Mr Riecken tells EX-YU Aviation News. In the first quarter, Lufthansa handled 56.944 travellers on its flights to and from Belgrade, making it the third busiest carrier in Serbia. It achieved this despite an almost 20% decline in the number of operated flights.

Air Serbia has been competing strongly against Lufthansa on services between its home market and Germany. The airline operates flights from Belgrade to Berlin, Dusseldorf, Frankfurt and Stuttgart, all of which are codeshared by both Air Berlin and Etihad Airways. Furthermore, the Serbian carrier codeshares on over twenty of Air Berlin’s routes, both domestically and internationally, while passengers from both airlines can redeem frequent flyer points on each other’s’ flights. Recently, Air Berlin placed a number of its own codes onto Air Serbia’s flights from Belgrade to destinations in the region and beyond. Despite a resurgent Serbian carrier, Lufthansa is still satisfied with its own performance on the market. “Lufthansa has been present in the Serbian market for 48 years as a part of the biggest foreign airline group. The Serbian market is one of the most important in Southeast Europe for Lufthansa. We see big potential in the market and expect further positive developments”.

Commenting on the tie-up between Air Serbia and Etihad, Mr Ricken says, “There is a world-wide discussion about the activities of three airlines from the Gulf region, with all of them trying to gain access to existing international passenger flows with their government-funded business models”. He adds, “We are in favor of competition in Europe and worldwide, but this has to take place based on fair rules and equal market conditions. A distortion of competition will always turn out to the disadvantage of the passengers, in the long run”. Lufthansa plans to operate double daily flights from both Frankfurt and Munich to the Serbian capital this coming winter season.

They would never pull out. Lufthansa has a massive advantage of having so many transit passengers on their flights. Even places like Dublin for example. There are considerable transits from Europe, let alone further away. What will be interesting is to see their response if Air Serbia starts US/Canada flights. Then they might become more aggressive.

Even if Air Serbia starts flying to North America, they wouldn't be anywhere close to being a threat to Lufthansa. Just look at the number of frequencies and destinations they offer. Not to mention that Frankfurt is getting a new terminal and Munich is getting another runway (plus the new terminal should be completed soon).

Air Serbia will be picking up Lufthansa's leftovers. JU would be going up against, not only Lufthansa, but United, Air Canada, Austrian Airlines... all which are part of the JV.

If Air Serbia was to start flying long-haul then they would need to have massive cash reserves, a fleet of A330s that will facilitate at least daily flights to New York, Chicago and Toronto.

Just look at Lot and it's own difficulties at surviving in that business... and all that despite having a massive O&D market to rely upon.

British Airways had mediocre loads in Belgrade so they probably found a better use for those slots. Air France on the other hand had great loads but their uncompetitive cost structure was their main issue.

Nemjee I don't think JU would hurt LH with their NA flights. What might get affected are numbers on their BEG-FRA and BEG-MUC flights but even that is questionable...

No matter what JU does in this market LH and the JV you mentioned is to big, too well positioned to even feel it. What JU would be after is low yielding niche which might or might not be enough to sustain these flights

The thing is that JU's transatlantic flights could develop in so many different ways that we could speculate until tomorrow. I still think that JU's biggest enemy wouldn't be Lufthansa or United but Belgrade airport. The airport was never meant to become a major hub and that's obvious from the way it was built. Nothing wrong in that given the era in which it was built. However, looking at the current situation, it has become more than obvious that the infrastructure we have today is incompatible with the business model Air Serbia is trying to develop.

On the other hand, it wouldn't be unwise for BEG management and the Serbian government to wait a little bit longer so as to see what becomes of Air Serbia and in what direction they grow. Unfortunately, our politicians love to get involved in things they know nothing about: Airports of Serbia, flights to the U.S., arrival of the A330s etc. Similar public statements do not do any favours to JU.

Also, this month will mark the one year anniversary since the arrival of Air Serbia's 8th A319 (YU-APD). I hoped that within a year at least one additional A319/320 will join the fleet, either for expansion or as a mere replacement for the ageing B733s. I am still hopeful more aircraft will join the fleet so as to enable the consolidation of the airline's network- which is, anyway, one of the basic requirements for any long-haul flying.

p.s. the arrival of YU-ALV is great but I see it more of a replacement for the old Atrs rather than an aircraft which can be used for growth. Interestingly enough, it's main role was to replace Aviolet on flights to Podgorica and Zagreb/Ljubljana.

I am certain that once Eurowings is fully operational they will add more flights from Germany to Belgrade.

Air Berlin is chronically on the verge of bankruptcy and until they figure out what kind of airline they want to be, they are no threat to Lufthansa.On the other hand, Air Berlin's troubles will only get worse when Ryanair opens their Berlin base and once Eurowings is fully unleashed.

I am excited to ride Lufthansa's ERJ190 between MUC and BEG in early September.

JU has caused other airlines at BEG to make themselves more competitive in price, thus allowing more passengers to travel.

Cheap fuel, strong USD compared to EUR, and lots of competition at BEG means that lots of my friends and family are visiting in the next few months. My mom and sister are in the air right now riding a Norwegian 787.

Last sentence of today's article :..."Lufthansa plans to operate double daily flights from both Frankfurt and Munich to the Serbian capital this coming winter season."So, it's not quite correct. Lufthansa reduced the number of flights from Frankfurt to one daily between 07thJanuary and 16thFebruary, excluding 10thJanuary.Btw, Swiss also reduced the number of flights from Zurich to 8 weekly and axed the route from Geneva during winter season.

Lufthansa has no room to expand in Serbia. INI is not ready for LH (and getting W6 to FMM soon), BEG already covered from both MUC and FRA. Eurowings are Lufthansa's vehicle to grow in Serbia and ex Yu. LH expects Eurowings brand to grow to 100 planes which is a lot more than Wizz has currently.

After maintaining Senator status with LH for three years (techically four, as status is valid for one more year), I have completely switched my travel over to the Etihad alliance. I got fed up with LH's constant nickel-and-diming and service reductions. Miles & More is one of thr worst frequent flyer programmes worldwide and keeps getting devalued on a quarterly basis. Even with the recent devaluation, Etihad Guest is still miles ahead (pun intended) in terms of award availability and redemptions.

Same here ... switched from M&M to Etihad Guest... from March Platinum ... it is pain in beginning to get things started and get all segments/miles registered, but when you get it done, then it is much better. i.e. with LH you need 45K miles to closest routes in Europe, and to earn that you really need to fly a lot ... with Etihad Guest you have it already from 11K return flight plus you earn that eaiser.

+1. I also jumped ships from Star Alliance (TK elite) to Air Serbia/Etihad. The only thing that bugs me is that JU don't have as systematic an approach to taking care of details, which matter a great deal to their status pax (on Star, for instance, gold members close to always get seats in the first couple of rows behind biz, with JU a gold pax can easily end up in 22E) and the same goes for lounges, in some cities JU flies to (ex ARN and CPH), JU simply doesn't bother to provide status pax with lounge access. Though mileage redemption with JU is worlds above any other FF program I've been part of.

I traveled a few days ago with JU from BRU to BEG and here is a few details for anyone interested. Y class was full to the last seat with an equal share of O&D and transfer pax, while C class had 2 pax. The positive details were good food ( hot meal for a 2 hour flight is just amazing), decent price for the round trip, and friendly stuff. The only negative detail was that the flight was late for around an hour or so. I myself did not care since my final destination was BEG, but there were many pax connecting to IST who barely made it on there next flight. Also I found it weird that after take off the pilots kept the seat belt sign on for the next 30-40 min even thought there was only minor turbulence hence many of us were finishing our meals over Hungary and nobody was allowed to use the toilets at that time. Is that a usual procedure if turbulence is anticipated?Anyhow decent flight and hopefully I will not be stuck in the middle seat next time and will be able to take a few pictures.

Big deal, other airlines in the region had code-shares to the US for years and years now. Maybe it's time for JU to join us in the 21st century but first they should get online checkin and a new, modern website.

Amazing how many "experts" think they know it all, when in reality, they know squat. AZ AND KL are unable to include or offer JU any codeshare across the Atlantic, due to their Skyteam JV, which is tightly bound together with AF and DL and precludes any other airline to enter this tightly knit monopoly. That is one of teh reasons why AZ served notice to withdraw from the alliance, because their interests have now changed, due to EY's shareholding in AZ.

As for AZ codeshare on JU flights beyond BEG, that will be coming shortly .....

MIA most overlooked in the US? News to me. It's the top international gateway in the US, key hub for the Caribbean and Latin America, cruise ship capital of the world. TK and OS are not overlooking MIA, they are starting service to it. Norwegian growth at FLL is just a tip of the iceberg. LH Jump and Eurowings all targeting south part of Florida.

Instead of temporary Air Berlin codeshare, wouldn't it be better to think long term about JU codeshare on American Airlines to key AA hubs beyond JFK, for example to ORD, LAX and MIA to start? AA can't be beat from JFK to those destinations and would make better codeshare partner than AB.

I have said time and time again that it is impossible to ban users. Unnecessary, rude and any other comments outside of the guidelines are deleted as soon as possible. Real time commenting is available here (unlike most places) with the assumption that people come to discuss aviation. Unfortunately, this right has been abused by some. Neither I, nor anyone else, can educate someone how to behave online. Therefore, the comments section is open under the assumption.that you come here to discuss either about the topic or any other aviation-related issue and not to argue with playground manners. If a comment offends you or you find it outside of the guidelines but it hasn't been deleted yet (as the comments section is not moderated 24/7), then just simply bring it to the attention of the admin rather then entering an argument and encouraging the perpetrator.

ALN and ALP are quite old and because of that they are not as reliable as they used to be. It could be that it's undergoing maintenance. I hope more Atrs join the fleet as they are what JU needs on regional routes.

By the way, YU-ALV is one of the most fantastic Atrs out there. It's brilliant on the inside.

Yet, ASL was unable to source 2 a/c, instead they took only one and now at least Bulgarian and other pax will be able to enjoy the A319. That's where the saying goes: "by trying to save pennies, you end up loosing pounds".

Info on Air Serbia wifi first leaked in Oct 2014. 10 months has passed and system is not yet available. Most of the summer season is already over and passengers who travel only once a year will have to wait for next summer to experience onboard wifi. You get the message.

In the meantime, Ka-band systems are becoming available enabling high quality internet video streaming like Netflix (not from onboard media server!), while I believe this Panasonic system (same one Alitalia will have) is still Ku-band. Ka coverage will next year include Europe, North America and North Atlantic. If we had to wait this long, why not wait bit longer for superior Ka-band solution?

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LIVERY OF THE WEEK

Jetstar special

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Australian low cost carrier Jetstar has unveiled a special livery on one of its Airbus A320s to promote the first country-specific version of the board game Scrabble. Manufacturer Mattel has included a list of local slang in its official glossary that are also featured on the jet, including words such as "Bonza", "Mollydooker" and "Devo". The A320 also includes the airline's name spelled out with Scrabble tiles. The jet is being used on both domestic and international routes and features Scrabble branding inside the cabin as well

GLOBAL AVIATION NEWS

Lufthansa, easyJet favourites for Air Berlin

Lufthansa Group and UK-based easyJet have been selected as preferred bidders for the main assets of the insolvent Air Berlin, the German carrier has confirmed. Lufthansa also submitted a bid for Air Berlin's Austria-based subsidiary Niki, which could be integrated into its LCC arm Eurowings. Air Berlin administrator Lucas Flother had planned to keep these decisions confidential until September 25, after Germany’s general elections. Air Berlin said in a statement that the creditors’ committee will continue talks with the two carriers until October 12 with the aim of selling Air Berlin's air transport assets. Talks with bidders interested in other assets will continue in parallel. Lufthansa Group CEO Carsten Spohr said at a media event in Frankfurt that Lufthansa’s bid for Air Berlin's assets is focused on securing the 38 Airbus A319/320s it wet leases from Air Berlin. The Star Alliance member is also interested in a further 20 to 40 aircraft, without creating antitrust concerns. Those 38 wet-leased aircraft carry about 1.000 passengers a day, mainly for LCC Eurowings, and Lufthansa’s priority is to keep that operation stable. Lufthansa would need around 3.000 new employees as it seeks to build market share following the exit of Air Berlin, which has 8.000 employees. However, Lufthansa is not interested in Air Berlin's long-haul routes because it said Eurowings can grow this segment on its own. Air Berlin will end long-haul operations September 25.
Source: ATW